Religious groups, Chattanooga own most untaxed county parcels

There are more than 4,000 properties in Hamilton County for which no tax dollars are collected, and nearly 70 percent are within Chattanooga.

County residents and most businesses pay taxes on the assessed value of their properties. And some pay additional tax based on the municipality in which they are located. But governmental, religious and fraternal organizations, and some property types, are exempt from property taxes.

According to Hamilton County tax assessor records, 4,020 of the 146,504 properties in Hamilton County are not assessed by anyone and generate no tax revenue. That represents 2.74 percent of all the parcels in the county.

But of those 4,020 untaxed parcels, 2,810 of them are in Chattanooga - which means the city misses out on its tax rate of $2.309 per $100 of assessed value for those properties.

Because the properties are not assessed, there is no way to say exactly how much revenue could be generated if they were returned to the tax rolls.

But even if each was assessed at $24,375, the median assessed value of all properties in the city, that would bring the city $1.5 million a year.

The Scenic City bears the brunt of the untaxed property burden countywide, but it owns less than 40 percent of the untaxed properties inside its borders.

According to assessment records, untaxed properties make up just over 4 percent of the 69,800 properties in the city. Chattanooga solely owns 554 - about 20 percent - of its untaxed properties. It jointly owns another 494 properties inside its borders with the county, accounting for another 18 percent of the total.

Churches make up the lion's share of the rest, with 1,001 parcels. The state owns 223 properties in Chattanooga, the city housing authority owns 165 parcels, the federal government has 123 and the county owns 86 properties. The remaining 164 parcels belong to the school system, fraternal organizations, the hospital authority, Red Bank or are cemeteries.

Richard Beeland, spokesman for Chattanooga Mayor Ron Littlefield, said there's little the city can do about churches and other government properties, but it does its best to get its own properties back on the tax rolls.

"Because of the economic downturn we've had and a lot of foreclosures, we own a lot of properties that we normally wouldn't," Beeland said.

The city seizes properties on which property taxes are not paid.

He also said sometimes governments "land bank" and swap land with other agencies to make sure there is room for growth in the future, he said.

Public utilities, such as the city-owned EPB, don't pay standard property taxes. But they are assessed by the state and make lump-sum payments to the cities or regions they serve. EPB paid out $16.8 million to Hamilton and surrounding Tennessee and Georgia counties last year, according to EPB spokesman John Pless.

For some businesses, governments negotiate pilot agreements, or alternative tax rates, to give the businesses incentive to locate there. There are 54 such agreements in Hamilton County, all but one are in the city limits of Chattanooga.